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PERENNIAL REAL ESTATE HOLDINGS LIMITED
Annual Report 2015
CORPORATE GOVERNANCE
The short-term incentive is primarily a remuneration-
based performance incentive that is linked to the
achievement of pre-agreed financial and non-financial
performance targets for Perennial and the individual
employees. Company-wide performance targets are
dependent on factors such as business performance
and operational growth. Individual performance targets
are set at the beginning of each financial year and are
aligned to the overall strategic, financial and
operational goals of Perennial. The short-term
performance incentive aims to improve collaboration
and ownership across the group to achieve shared
operational and financial growth targets.
Long-term incentives consist of share options that were
granted based on the achievement of corporate and
individual performance targets. Vesting of these share
options will be over a four-year period. Such long-term
remuneration is a retention tool and is aligned with the
interests of the Shareholders and promotes long-term
success of the Company and the group as a whole.
More information on the Perennial Employee Share
Option Scheme 2014 can be found in the Directors’
Statement from pages 180 to 182 and in the Notes to
Financial Statements from pages 228 to 230.
ACCOUNTABILITY (GUIDELINE 10)
The Board is responsible for and committed to present
a balanced, transparent, and understandable
assessment of the Company’s and the group’s
performance, positions and prospects to the
Shareholders at all times. Perennial believes in
conducting itself in ways that seek to deliver
sustainable value to its Shareholders.
Guideline 10.1: Extension of theBoard’s responsibility
Perennial presents a balanced and clear assessment of
its performance, position and prospects to
Shareholders through the timely release of its quarterly
and annual financial reports. Perennial believes that
prompt compliance with statutory reporting
requirements is imperative to maintaining Shareholders’
confidence and trust in the group. In line with SGX-ST’s
requirements, negative assurance statements were
issued by the Board to accompany Perennial’s
quarterly financial results announcements, confirming
that to the best of its knowledge, nothing had come to
its attention which would render Perennial’s quarterly
results false or misleading.
Guideline 10.2 : Adequacy in ensuring legislative
and regulatory compliance
The Board ensures that it is updated regularly on
relevant changes to laws and regulations so that it can
monitor and supervise adequate compliance by
Perennial with such laws, regulations and requirements
of regulatory and governmental authorities. Changes
to accounting standards and accounting issues which
have a direct impact on the financial statements are
reported to the ARC, and highlighted by the external
auditors in their quarterly reviews with the ARC.
Guideline 10.3 : Monthly provision of information
Directors receive operational and financial reports on
the performance of Perennial on a regular basis, which
includes key performance indicators, variance
analyses, property updates, strategic and business
highlights and key developments. Where the situation
requires, the Directors are entitled to request for any
additional information which will be provided by the
Management in a timely manner.
RISK MANAGEMENT AND INTERNAL
CONTROLS (GUIDELINE 11)
Guideline 11.1 : Determination of risk tolerance and
risk policies
Risk management is an integral part of the manner in
which Perennial manages and runs its businesses.
The Board has overall responsibility for the governance
of Perennial’s risk management and internal controls.
The Board and the Management are fully committed to
maintaining sound risk management and internal
control systems to safeguard the Shareholders'
interests and Perennial’s assets.
In order to create, enhance and protect value for its
Shareholders, Perennial proactively manages risks and
embeds the risk management process into all planning
and decision-making processes as well as its day-to-
day operations at the Company and group levels.
All major investments and projects undergo a
comprehensive due diligence and risk management
review process. The Board sets the overall strategic
direction, governs the risk management strategy and
framework, and determines the risk tolerance levels and
risk policies for Perennial. With these in place,
the Board oversees the Management in the design,
implementation and monitoring of risk management and
internal control systems, and ensures that strategies are
aligned with the risk tolerance levels as well as any
potential emerging risks that Perennial may face.
